Estate agent forced up prices with bogus bids

A disgraced estate agent whose firm was caught trying to cheat househunters into raising their offers by inventing rival bidders has been struck off for life.

Allan Langley-Smith now faces a police probe into his activities.

Investigators who caught his staff making up the fictitious bids also found that a vendor was not told about an offer from one would-be buyer who had declined to use the firm's in-house mortgage advice team.

The case comes amid growing concern about the underhand activities of some agents. Which? consumer campaigner Emma Harrison said today: "The Government must now accept that it is time to implement full regulation of estate agents. Only this will bring rogue agents into line and boost public confidence in the industry."

Brighton-based Hadleys Letting and Estate Agents was set up by Langley-Smith in 1996. By last summer, trading standards officers from Brighton and Hove council had fielded a string of complaints from disgruntled customers.

Which? was alerted and sent in its team of undercover investigators. One of the team posed as a buyer and offered £77,000 for a flat being sold through Hadleys and owned by another Which? investigator. "We were aware of what offers were and were not being made," said the wouldbe buyer.

He added: "Hadleys told me another potential buyer had offered £78,000 and the owner was looking for an offer closer to £80,000. We knew this was a complete invention and a clear breach of the Estate Agents Act."

It was found that Langley-Smith had not passed on an offer from a buyer who did not seek mortgage advice from Hadleys staff, but did pass on a much lower bid for the same property from a buyer who did seek their guidance.

Trading standards officers reported Langley-Smith to the Office of Fair Trading (OFT), which has now ruled him "unfit to carry on estate agency work". Police and trading standards are considering whether to bring criminal charges.

Hadleys closed in May after rent on its offices was not paid. But the firm left scores of out-of-pocket landlords and tenants behind. Brighton and Hove trading standards said: "We have a list of about 40 tenants and landlords affected." Jane Wilkinson, a member of the Brighton and Hove Estate Agents' Association, said: "We are seeing far too many situations like this because the lettings industry is completely unregulated."

Langley-Smith was able to set up in estate agency with no training, qualifications or registration and there is no body responsible for compensating his victims.

In March the OFT published the results of a two-year probe into estate agents, revealing widespread malpractice-but concluding that nothing should be done for at least two more years. Peter Bolton King, chief executive of the National Association of Estate Agents, said the Brighton agent's behaviour was typical of the cowboy end of the industry.

He said: "We have campaigned for better regulation. Estate agents are the only link in the home-buying chain not to be regulated, and it is crucial to protect the public.

"We can expel and heavily fine our members when they misbehave but we cannot stop them from continuing to practise. We are urging the Government to step in with a statutory scheme." The Royal Institution of Chartered Surveyors also backs statutory regulation.

Langley-Smith has moved to Spain. He declined to comment but his solicitor, Mark Westwood, said: "We were just dealing with a possible sale of the business that was being negotiated a while back but that fell through. Allan needs to instruct someone else to help him deal with this."